The owner of the 14 Riverside buildings, which host the DusitD2 Hotel in Nairobi, has suffered yet another blow after the Court of Appeal rejected an application to stop the planned auction of the property in a long-running dispute with a creditor.
The court also rejected Cape Holdings' proposal for the property to be sold by private treaty and the proceeds to be deposited in an interest-earning account, pending the taking of accounts and debts owed to Synergy Industrial Credit Ltd, I&M Bank, and other creditors.
According to the court, the issues the company was raising have been litigated all the way to the Supreme Court, and there was no basis upon which the court could be invited to revisit what has already been decided.
The court noted that the decree issued in March 2021 in favour of Synergy Industrial Credit was issued in line with an 'arbitral award that has survived challenge at every judicial level'.
Further, the court said questions of interest, limitation, and computation were either expressly determined or were matters that ought to have been raised at the appropriate stage of challenge to the award.
"They cannot now be revived through execution proceedings or reframed as novel points of law. We do not think that these issues are arguable," said the court.
A bench of three judges of the appellate court noted that the High Court suspended the intended sale pending the undertaking of a fresh valuation and the issuance of fresh warrants.
The court added that there was no material before it to suggest that any step is being taken outside the supervision or authority of the High Court.
Cape Holdings rushed to the Court of Appeal in December 2025, asserting that the High Court erred in declining to review earlier decisions in a manner that effectively shut out consideration of the taking of accounts under Section 34 of the Civil Procedure Act.
In the firm's view, the rejection amounted to a miscarriage of justice.
The creditor maintained that the amount has since escalated dramatically due to what it termed unconscionable and unproven interest.
According to Cape Holdings, the principal deposits made by Synergy Industrial Credit were about Sh577 million, and even on its calculations, without applying the in duplum rule, the amount would be approximately Sh1.4 billion, yet the creditor was claiming in excess of Sh10 billion.
The firm further contended that the 18 percent compound interest applied to both the Kenyan shilling and dollar components was never pleaded or proved in evidence but was introduced through submissions.
Cape Holdings said it had consistently sought to take accounts and has filed applications specifying what it considers to be the lawful rates of interest.
The firm added that all these efforts were dismissed summarily and that attempts at negotiation had not elicited a response.
Cape Holdings added that it had offered to transfer property valued at approximately Sh1.05 billion to Synergy, in partial settlement pending the taking of accounts.
Further, the total value of the development, according to the latest valuation, is about Sh7 billion, and an application is pending to facilitate subleases to enable orderly realization, if necessary.
Synergy Industrial Credit opposed the application, arguing that it was yet another attempt to prolong the matter, yet the issues of interest have since been determined by the court.
The court said Synergy Industrial Credit took over the property through an attachment on January 14, 2022, when a prohibition order was registered against the title to the asset.
The long-running dispute started in 2009 when Cape Holdings Limited decided to develop the complex near the University of Nairobi’s Chiromo campus.
The firm then invited Synergy Industrial Credit Ltd to buy blocks in the property earmarked for development, and the latter paid Sh750 million for two blocks, comprising 14 units and parking lots.
Trouble started when the property was completed, and Cape Holdings allegedly refused to transfer the property to Synergy Industrial Credit as agreed.
What followed was a court battle that began before an arbitrator, and the dispute escalated to the Supreme Court before it was returned to the High Court, where the sale was sanctioned.
